HUNGARY
Macro Newsletter S e p t e m b e r
2 0 2 6
Domestic News
D O M E S T I C
N E W S
Resilient Growth Amid Easing Inflation and Emerging Headwinds •
•
Hungary’s economy expanded by 1.7% year-on-year in Q2 2026, matching Q1 and marking the strongest growth since Q2 2024. Growth was mainly supported by industry (+3.7%) and services (+1.9%), particularly professional, scientific, technical and administrative activities. In contrast, construction declined by 0.3%, while agriculture fell sharply by 12.4% due to severe drought. Household consumption remained a key growth driver (+4.5%), while gross fixed capital formation contracted by 6.3%. Despite continued weakness in the external environment, the economy is expected to maintain its positive trajectory, with 2026 GDP growth forecast at 1.8%. Hungary’s annual inflation edged up to 1.3% in August 2026, from 1.2% in July, remaining close to its lowest level in a decade. The increase was mainly driven by higher prices for alcohol and tobacco, consumer durables, fuels and services (+5%). In contrast, food (-1.4%), clothing (-0.2%) and household energy (-4.3%) prices declined. Core inflation rose slightly to
2.0%, while monthly inflation increased by 0.2%. •
National Bank of Hungary kept its benchmark interest rate unchanged at 5.5% in September 2026, following four cuts earlier this year. The decision reflected elevated global risks and continued pressure on energy prices. Despite inflation rising slightly to 1.3% in August, the central bank lowered its medium-term inflation target to 2.5±1% from 2028. The 2027 inflation forecast was raised to 3.1%, while the 2028 forecast was lowered to 2.6%.
•
Hungary’s unemployment rate rose to 4.6% in May–July 2026, from 4.3% a year earlier. Unemployment stood at 4.4% among men and 4.9% among women. The average job-search period was 12 months, while the share of long-term unemployed (over one year) increased by 5.5 percentage points to 34.7%, indicating a gradual deterioration in labour-market conditions.
Base rate evolution in Hungary, % 14 12 10 8 6 4 2 0
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Source: MNB
2
Domestic News
D O M E S T I C
N E W S
Industrial Recovery and Stronger Domestic Demand Support Growth •
•
Hungary’s industrial production grew 4.7% year-on-year in July 2026, slowing from 10.1% in June, mainly due to weaker manufacturing growth (+4.9%). Transport equipment (+18.0%) and computer, electronic and optical products (+19.7%) remained key growth drivers, while chemicals and refined petroleum products also accelerated. Food, beverages and tobacco (-2.3%) and electrical equipment (-6.0%) continued to decline. Monthly output rose 1.7%, bringing growth in the first seven months of 2026 to 2.7%. Hungary’s retail sales grew 4.9% year-on-year in July 2026, accelerating from 3.0% in June and marking the strongest growth since March. Growth was driven by stronger food,
beverage and tobacco sales (+2.2%), non-food sales (+6.5%) and a sharp rebound in fuel sales (+8.1%). Monthly retail activity increased 1.0%, while sales were 4.5% higher year-onyear in the first seven months of 2026.
•
At the same time, Hungary’s financial markets continued to show increasing stability despite persistent geopolitical uncertainty. By the end of September, the forint was trading at around HUF 366/EUR, supported by improved post-election stability and still relatively attractive interest rates. Meanwhile, the 10-year government bond yield began to rise again, reflecting renewed inflationary pressures and growing concerns over the inflation outlook.
EUR/HUF ex. rate (2021-2026) 440 420 400 380 360 340 320
Source: MNB
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3
Energy Market
2026.09.24
2026.08.24
2026.07.24
2026.06.24
2026.05.24
2026.04.24
2026.03.24
2026.02.24
2026.01.24
2025.12.24
2025.11.24
2025.10.24
2025.09.24
2025.08.24
2025.07.24
2025.06.24
2025.05.24
2025.04.24
2025.03.24
2025.02.24
2025.01.24
2024.12.24
European natural gas prices rose toward €74/MWh, rebounding from a three-week low amid continued uncertainty over the Middle East conflict and the reopening of the Strait of Hormuz, a key LNG transit route. Europe’s gas storage was around 70% full, below the five-year average and the 80% target ahead of winter. Goldman Sachs warned that prices could exceed €100/MWh during peak winter if Gulf LNG exports remain constrained.
2024.11.24
•
2024.10.24
Brent crude rose above $105 per barrel, as heightened Middle East tensions raised concerns over energy supply and prospects for a diplomatic resolution. Uncertainty over US-Iran negotiations and potential restrictions on navigation through the Strait of Hormuz kept oil markets highly sensitive to further escalation.
85 80 75 70 65 60 55 50 45 40 35 30 25 20
2024.09.24
•
M A R K E T
EU DUTCH TTF Gas Price (EUR/MWh)
2024.08.24
Global Energy Markets: Renewed Geopolitical Risks Put Pressure on Oil and Gas Prices
E N E R G Y
Source: Trading economics
Brent oil price (USD/Bbl) 115 105 95 85 75 65
2026.09.24
2026.08.24
2026.07.24
2026.06.24
2026.05.24
2026.04.24
2026.03.24
2026.02.24
2026.01.24
2025.12.24
2025.11.24
2025.10.24
2025.09.24
2025.08.24
2025.07.24
2025.06.24
2025.05.24
2025.04.24
2025.03.24
2025.02.24
2025.01.24
2024.12.24
2024.11.24
2024.10.24
2024.09.24
2024.08.24
55
Source: Trading economics
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4
Eurozone
E U R O Z O N E
Rising Inflation Meets Persistent Industrial Weakness •
•
The European Central Bank raised its key interest rates by 25 bps in September, marking its second hike since the US-Iran war began, amid persistent inflationary pressures from the Middle East conflict. The main refinancing rate increased to 2.65% and the deposit rate to 2.5%. The ECB maintained its 2026 inflation forecast at 3.0%, while raising the 2027 and 2028 forecasts to 2.5% and 2.1%, respectively. ECB President Christine Lagarde noted that growth risks are tilted to the downside, while inflation risks remain tilted to the upside. Eurozone annual inflation accelerated to 3.2% in August 2026, matching May’s two-and-a-half-year high but slightly below the preliminary 3.3% estimate. The increase was mainly driven by energy prices, with energy inflation rising to 14.3% amid continued Middle East tensions. In contrast, services inflation eased to 3.0%, while core inflation
declined slightly to 2.4%. Among major economies, inflation increased in Germany (2.9%), France (2.6%), Spain (4.6%) and Italy (3.2%), while the Netherlands saw a decline to 2.8%. •
Germany’s industrial production fell 1.1% month-onmonth in July 2026, reversing June’s stagnation and marking the fourth monthly decline this year. The drop was mainly driven by a 9.2% plunge in automotive production following production shutdowns. Excluding energy and construction, output declined 2.2%, with capital goods (-3.4%) and consumer goods (-2.2%) among the main contributors. In contrast, energy production increased 4.7% and construction by 0.9%. Industrial output fell 1.6% year-on-year, highlighting continued weakness in Germany’s manufacturing sector.
Eurozone main refinancing operations rate, % 5
EUR/USD ex. rate
4
1,21
3
1,2 1,19
2
1,18 1,17
1
1,16 1,15
0 09.2017 01.2018 05.2018 09.2018 01.2019 05.2019 09.2019 01.2020 05.2020 09.2020 01.2021 05.2021 09.2021 01.2022 05.2022 09.2022 01.2023 05.2023 09.2023 01.2024 05.2024 09.2024 01.2025 05.2025 09.2025 01. 2026 05.2026 09.2026
1,14 1,13 1,12 14.jan.26
14.febr.26
14.márc.26
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14.ápr.26
14.máj.26
14.jún.26
14.júl.26
14.aug.26
14.szept.26
Source: Trading Economics
Source: ECB
5
USA
M A C R O
U S A
Persistent Inflation and Rising Yields Reinforce a Higher-for-Longer Outlook •
•
US annual inflation remained at 3.4% in August 2026, unchanged from July and in line with forecasts. The main upward pressure came from energy, with gasoline prices rising 27.4% year-on-year and fuel oil 52%, while shelter (+3.0%) and food (+2.7%) inflation eased. Monthly CPI increased 0.4%, driven largely by a 3.9% rise in gasoline prices. Meanwhile, core CPI rose 0.3% month-on-month, while its annual rate eased to 2.4%, the lowest since March 2021. The US unemployment rate remained at 4.1% in August 2026, in line with expectations. The number of unemployed rose by 115,000 to 7.03 million, while employment increased by 569,000 to 162.75 million. The labour force expanded by 683,000, lifting participation to 61.6% from 61.4% in July, while the employment-
to-population ratio edged up to 59.1%. Meanwhile, the broader U-6 unemployment rate eased to 7.7% from 7.9%, indicating modestly improved labour-market conditions.
•
US 10-year Treasury yield rose to 5.14%, its highest level since July 2007, while the 30-year yield climbed above 5.44%, reaching its highest since 2004. Rising oil prices amid heightened US-Iran tensions have increased inflation concerns, particularly as US diesel prices hit a new record. Against this backdrop, markets have increased bets on further Fed tightening. Recent hawkish Fed comments and continued strength in US economic activity, reflected in the September S&P Global PMI, added further pressure on Treasury yields.
US 10 year Bond evolution, %
Source: Trading Economics
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Forecast Hungary
M A C R O
Economic indicators
2022
2023
2024
2025
2026*
Real GDP growth (%)
4.6
-0.9
0.6
0.5
1.8
Industrial output growth (%)
5.8
-5.5
-4.0
-3.2
2.0
Investments (%)
0.3
-10.2
-13.8
-4.3
2.3
Inflation (%)
14.5
17.6
3.7
4.4
1.8
Gross wages (%)
17.6
14.0
13.2
8.8
9
General government balance (% of GDP)
-6.2
-7.0
-5.1
-4.7
-7.5
Public debt (% of GDP)
74.1
73.3
73.5
74.6
77.5
Unemployment rate (%)
3.6
4.2
4.3
4.4
4.6
Base rate (end of year), %
13
10.75
6.5
6.5
5.5
10 year bond yield (end of year) (%)
8.98
5.93
6.5
6.87
5.9
F O R E C A S T
Source: Colliers
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